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Can Internet telephony work on the public Internet? Help From a 7x24 Professional Deployment Team What is Callback and can it work with Internet telephony? Who buys Internet telephony phone-to-phone calls today? ISPs can earn money as an Internet telephony terminators ISPs can be Internet telephony originators If you are a prepaid calling card company, should you be in the Internet telephony industry? International Telecom Settlement and Arbitrage How to Select an ISP for Quality Internet Telephony Tips for Selecting a Billing System for IP Telephony Originators and Terminators Can Internet telephony work on
the public Internet? ======================================================== Help From a 7x24 Professional Deployment Team When choosing a tier one Internet telephony carrier, like ITXC Corp, make sure you find out if they have a 7x24 professional deployment team to help you connect to their network. A professional deployment team should run ping (tests how long it takes for the originating and terminating gateways to communicate) and trace route (shows the path that the packets take from one gateway to another) tests. A professional deployment team should also run test calls to your gateway if you are a terminator, from your gateway if you are an originator, or to and from your gateway if you are both. They should check the billing records from your gateway and theirs to make sure that they match. If there is a problem, they should troubleshoot, either by assisting you with your gateway configuration, IP route, PTT line configurations etc. or by finding someone that can fix the problem. You should not have to find your own way to a tier one
Internet telephony carrier’s network, their deployment team should help you. What is Callback and can it work with Internet telephony? Callback is based on the simple proposition: it is cheaper to call international from the United States than from anywhere else. To take advantage of this, travelers would place a collect call to their family in the U.S., who would decline the call. This would be a prompt for the family to return the call - thereby taking advantage of low U.S. rates. Callback has simply automated and economized this process. The Callback market over the years has flourished, but is now coming to a dramatic end. The reason for this is: Callback companies can no longer easily compete in the market place. Every call made by a Callback switch is two legged. This means it takes two connections for every call: one to connect the user and one to connect the dialed party and thus, two costs for each call. With the rates coming down the way they are, it is becoming less and less profitable for Callback companies. Margins are slipping and Callback companies are losing customers every day to alternative services. There is a solution! Internet telephony. With Internet telephony, Callback companies can now get back into the game. By transitioning customers from a Callback service to a direct dial service (Internet telephony), Callback agents worldwide can flourish once again. Internet telephony is somewhat similar to the Callback model, with one major difference. Internet telephony gets the caller to the US for little or no cost, thus, replacing the Callback B Leg, which is the leg of the call that connects the user to the US Callback switch. The user can now dial as if he or she was in the US. The transition is simple. When a Callback company contacts a tier one Internet telephony carrier, like ITXC, the carrier will walk the Callback company through the process. This will enable Callback companies to create in essence its own network. This does two things: it creates value to the Callback company by having its own network and it allows the Callback company to go after business aggressively with a great margin. Internet telephony is the future for Callback. Who buys Internet telephony phone-to-phone calls today? One might say that the Internet telephony industry is not really an industry because consumers or end-users are not buying Internet telephony calls. They buy phone calls and the Internet is just a route for the calls to travel on. Then who buys the routes? Pre-paid calling card companies, call-back companies, competitive carriers, and any company that is selling discounted long distance phone calls. They buy the Internet telephony route, as long as the quality is good and the price is right, just as they would buy a PSTN route. However, in this case, they would buy from an Internet telephony carrier, like ITXC Corp, instead of a PSTN carrier. The phone calls made by their customers then travel over the Internet. These companies are not promoting that their calls go over the Internet because their customers don’t care how their calls travel, as long as they can have inexpensive, but good quality, long distance phone calls. So, the next time you use a pre-paid calling card, your phone call will probably travel by way of Internet telephony. ======================================================== ISPs can earn money as an Internet telephony terminators Internet telephony is an opportunity for an ISP to earn additional money. Non-US based ISP A non-US based ISP can terminate calls from around the world that come to their town. An ISPs gateway can be configured to act as a terminating gateway. It can receive Internet telephony calls originated from anywhere in the world, convert them back to voice and transfer them to the local phone company. An ISP profits by being paid by a tier one Internet telephony carrier, such as ITXC, for these terminating minutes. It can make the most profit if it is terminating calls in a country where PSTN rates to that country are high. The tier one Internet telephony carrier handles the sales and marketing, is responsible for sending calls (and filling the lines) to the ISPs terminating gateway, controls the quality, and assures that the ISP will be paid. US facilities-based ISP If a US facilities-based ISP has facilities in many locations, is located in an area that receives a very large volume of international calls and has other reasons for operating the gateway, such as originating, it can sometimes make sense to terminate Internet telephony calls. A US facilities-based ISP can not make as much money as a non-US based ISP because PSTN local long distance calls within the US are currently very inexpensive. This makes it difficult for ISPs to be price competitive and profitable. In the near future, US based ISPs will be involved in selling very sophisticated communications products that combine Web information, voice, video, unified messaging, etc. A US based ISP can make the case that it should begin investigating this new technology so that it is an early adapter of new enhanced services and can therefore have a competitive edge. The ideal Terminator has:
======================================================== ISPs can be Internet telephony originators Many ISPs think Internet telephony has possibilities, but don’t offer it. Other ISPs offer it so that when enhanced services become available to Internet telephony, they will be able to offer the enhanced services to their customers. How can an ISP be an Internet telephony originator? 1. An ISP can sell pre-paid calling cards or provide monthly billing to its current customers or to new customers. The customers use any phone to dial a local number or 800 number into an Internet telephony gateway and pre-paid calling card platform operated by the ISP. They give their PIN number and place their calls at a substantial price savings from traditional international calling. The customers pay the ISP who in turn pays an Internet telephony carrier, like ITXC, who routes the call and manages the quality. The ISP then keeps the difference as its profit. 2. PC-to-Phone – where the ISP owns several terminating gateways and sells the service to its customers. The customers download the PC-to-Phone software. (ITXC does not currently offer PC-to-Phone.) For the ISP, being an Internet telephony originator is not always easy. ISPs know a lot about the Internet, but most do not know how to sell telephone calls. Internet telephony is not the ISPs main product, it is a feature for the ISP’s customer. The ISP will have to spend additional money to purchase gateways to handle Internet telephony calls. The ISP must also have technical people who understand how to work the gateways. The world will eventually be communicating only on a data network. By getting into the Internet telephony industry early, an ISP can be ready to offer its customers the phone calls along with the enhanced services, like unified messaging, one number, follow me, or video and voice conferencing, over the Internet. ======================================================== If you are a prepaid calling card company, should you be in the Internet telephony industry? The answer is yes. If you are a prepaid calling card company, you should think about purchasing international routes from a tier one Internet telephony carrier, if you are not already doing so. There are many prepaid calling card companies that are. The prepaid calling card company can purchase these routes just as it would purchase routes from a 2nd and 3rd tier PSTN carrier. It can bring a T1 to the Internet telephony carrier’s switch. The Internet telephony carrier converts the voice to packets, sends the packets over the Internet, and puts the packets back together at the termination location. The prepaid calling card company then receives a monthly bill, with Call Detail Record’s (CDR’s), for its originating calls. What is the benefit to purchasing international routes from a tier one Internet telephony carrier? The obvious benefit is price. An Internet telephony call is usually 5-10% cheaper than a 2nd and 3rd tier PSTN call. You don’t have to sacrifice quality. A tier one Internet telephony carrier should offer BVR (Best Value Routing). BVR enables the tier one Internet telephony carrier to find and use the least expensive route that also has the best quality, thus the best value. Because the tier one Internet telephony carrier offers BVR, it is usually at the top of a routing table. ======================================================== International
Telecom Settlement and Arbitrage ======================================================== How to Select an ISP for Quality Internet Telephony There is more than one factor that can determine the quality of an Internet telephony call, but a good ISP is one of them. An Internet telephony carrier, like ITXC, can help its customers or affiliates find and test ISPs. However, here are a few questions that you must ask when selecting an ISP: 1. How far removed from the Internet backbone is your provider? Try to get as close to the backbone as you can. The closer to the backbone, the less number of hops a packet will have to take to get to its destination. A backbone provider owns part of the Internet backbone. Many people label providers by their tier. A tier 1 provider is one step from the backbone. In other words, they should buy their connectivity from at least two backbone providers. A tier 2 provider buys from a tier 1 provider and sometimes a backbone as a backup. However, the amount of bandwidth is less than what they get from their main provider. If you buy from a lower tier provider then you are adding router hops to the Internet and that can cause trouble. Each hop is one more point of failure and one more place to trouble-shoot in the event of a problem. 2. How much bandwidth does your provider have? Bandwidth is plentiful in US cities, but it is not always in the rural areas or other countries.
3. What type of redundancy does your provider have? A single line to the Internet from your provider introduces a single point of failure for you and your customers. A good ISP will have multiple routes to the Internet to ensure a consistent connection. If your prospective provider is a tier 1, ask if they have multiple connections to the same backbone provider or multiple connections to different backbone providers. The second scenario is better because your packets will have shorter paths to their destinations - if they are going to a destination on the same network. These are good basic questions to start asking your prospective provider. All providers should be more than willing to tell you about this information and it should be very easy for them to get this information to you. If you choose a provider that rates high in these 3 areas you will have the foundation for a great VoIP experience. ======================================================== When choosing an Internet telephony carrier, be sure you know what you are buying and what you need. There is a difference between a broker and a tier one Internet telephony exchange carrier. Both are sometimes referred to as clearinghouses, yet there is a difference. A broker introduces a member, looking to buy minutes to a particular destination, to another member who sells minutes to that particular destination. The broker then takes a cut of the traffic or charges a fee. A broker might introduce you to a cheap Internet telephony route, but they do not necessarily manage the route for quality and do not necessarily provide settlement. If you do not need these services, do use a broker. Among the benefits of using a Tier 1 Internet telephony exchange carrier is its NOC (Network Operations Center) and BVR (Best Value Routing.) The NOC monitors the route for quality 24 hours a day/7days a week. It also offers BVR so that you are getting the least expensive route that has the best quality….not just the least expensive route. ========================================================= Many major gateway and gatekeeper manufacturers have agreed
to become ========================================================= Tips for Selecting a Billing System for IP Telephony Originators and
Terminators To make sure you are getting a billing system that meets your current and future requirements, it is important to understand some of the basic functions that a billing system provides. A billing system contains these functions: Call Detail Report (CDR) collection, service pricing, billing cycle management, invoicing, A/R management, and reporting. CDR Collection The CDR collection function mediates between your gateways and your billing system to retrieve CDRs from the gateways, format them, and import them into the billing system databases. Unless the gateway is supported by the prospective billing system out-of-box, the CDR collection sub-systems will typically require the most customization, and, therefore, the highest expense. Even if the billing system has out-of-box capabilities, gateway software is upgraded frequently. You will definitely want to ask your prospective billing system vendor "How platform-independent is the CDR collection sub-system?" If you decide to purchase an unsupported gateway, find out how much time and money it will cost to have your billing vendor develop CDR collection support for it? Is the billing vendor willing to fix price or cap costs? What is the billing system upgrade policy when the gateway vendor upgrades currently supported gateways? Make sure you know if you are required to pay for each resulting billing system upgrade -- it could get expensive. Service Pricing The service pricing function calculates charges for events and phone calls. Today, the most common pricing structures are "per minute" charges by destination point and flat rates for a limited or an unlimited amount of minutes. At a minimum, these should be supported by the system. In addition, you will want to make sure that the system allows one-time and recurring charges for things such as setup and activation fees. Flexibility to allow each customer a unique rate plan is a must. Billing Cycle Management, Invoicing, and A/R The billing cycle management and invoicing sub-system adds the charges for each account and renders an invoice. Web-based invoices and account maintenance interfaces are quickly gaining popularity and may allow you to significantly reduce customer service costs. If your customers can retrieve their invoices and enter payments online, this will translate into lower customer support costs. Reporting No doubt, your management team and functional areas are primarily interested in reports. They want to see information such as the aging status of your accounts, total revenue for a given month, G/L figures, revenue by customer, call detail and summaries, etc… This is another area that may require significant customization. No matter how comprehensive the reports are that come with the system, your users will want to see the information differently. Submitting report development requests to your billing system vendor will likely be expensive, slow, and takes the vendor’s focus away from more critical areas, such as developing support for new gateways. Therefore, your best bet is to purchase an inexpensive, off-the-shelf report writer, such as Crystal Reports, build in-house expertise on the database structure and content of the billing system, and enjoy the ability to extract any information you need to make decisions as-needed. Advanced users and junior level IT professionals should be able to effectively wield a report writer, making this an inexpensive option. ========================================================= About ITXC Corp: Don't forget to checkout the hot telephony book titles and software in our book shelf available from Barnes and Noble
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